May 22, 2015To Members Only: As we outlined in our update earlier this week, we wanted to provide you with a full analysis and details of the current iteration of this year’s state budget. I want to stress again that our work is not done yet, and the budget has several more steps to clear before it is finalized. Overall, my takeaway at this stage is that we have come extremely far in the past couple of years in our goals of increasing understanding about independent charter schools and our collective work. The financial picture of education in our state continues to be concerning; however, this year we have made progress toward closing the state funding gap (though not as much as we would like). Ultimately, the dollars weren’t there this year to have a major increase, but as I mentioned earlier this week, our increase is likely to be among the largest in per-pupil spending capabilities for the next two years. To me, this is a direct recognition of the work our schools are doing with students. On the policy side, we’ve made several important strides that reflect your priorities, such as opening up transportation funding, removing the Racine charter cap, gaining even more flexibility in teacher licensing, and access to underutilized spaces within MPS. Other policies, such as access to other categorical funds (such as K3, summer school, and library book funding), remain in our scope of work ahead. Below you will find a more detailed description of each budget item that directly affects our charter schools. We’ll continue to keep you updated as these things change, but please reach out with any questions in the meantime. Thanks again for your support, membership, and advocacy.Funding: The 2R amount will be increased by approximately $120 overall, based on a formula of school aids. For the 2015-16 school year, it is estimated to be $8,087, with that amount rising to $8,195 in 2016-17. These are estimates for now and could be changed slightly depending on that formula funding. For comparison, districts will see about $100 in spending increases over the next two years.Accountability: Several changes will occur in the statewide report card calculation, all of which should benefit our member schools. First, growth will be calculated using a value-added methodology. In other words, student growth will be compared to how other similar students were expected to grow in the state. The scores will also be weighted based on time attended at each school: a student who enrolls in January and takes the state test in March wouldn’t count as much as a student who has been in your school for 3 years. Additionally, growth and achievement will be weighted differently on the report card. Schools that have more than 65% of their students below the poverty line will have 90% of their score weighted toward growth and only 10% toward achievement.Facilities: The process for selling empty/underutilized spaces in the district is more prescriptive under the current language. It defines an underutilized space as one in which less than 40% of its capacity is used. There are also some other qualifiers, such as teachers and administrators needing to be assigned to a building. After a school is on the “underutilized” list, then operators of schools (2Rs, non-instrumentalities, or choice schools) may submit bids for purchase. That price is required to be a “reasonable purchase price” based on comparable buildings, location, etc. This should significantly open up unused spaces, though the district may still attempt to stonewall these efforts or “shuffle” their space around to keep as many buildings as possible. This version is better than previous ones and is certainly moving in the right direction. Transportation: 2R charters will be eligible for transportation categorical aid. For reference, here are the reimbursement rates from last year: Distance traveled (one way); Rate per pupil 0-2 miles; $15 2-5 miles; $35 5-8 miles; $55 8-12 miles; $110 More than 12 miles; $275Testing: There will be a state test, but LEAs may either take that test or choose from a list of 3-5 alternatives that are developed by the Value Added Resource Center in Madison. The idea behind this is that they would be tests that could be “translated” to equivalency scores with the state test. Students in K4-2nd grade must take a reading readiness assessment annually, which will be reimbursed by DPI. Schools may choose which exam to administer to their students. This is a sum-sufficient appropriation, however, so if funding runs out, the reimbursement may be prorated. High school students must pass a civics exam to graduate beginning in 2016-2017, consisting of 100 questions identical to the 100 questions that can be asked on the U.S. Citizenship test. Students must get at least 60 questions right, and LEAs can determine the format and timing of the test. Students may take the test as many times as needed to pass. Teacher Licensing: DPI must license any teacher seeking licensure that an LEA determines has the subject matter competence and necessary experience to teach. DPI must issue a permit to any teacher that an LEA determines has subject matter competence. How this will look in terms of DPI’s rollout, application materials, etc. is unclear. We’ll keep members posted on these developments.High School SPED Grants: Schools may apply for $1,000 SPED grants, which are awarded to schools who have students with IEPs who, within 1 year of graduating, are enrolled in higher education, competitively employed, or enrolled in other postsecondary training. However, with only $100,000 allocated for this, those grants would unlikely be a full $1,000.Extracurriculars: 2R students may participate in a district’s extracurricular activities if the school does not provide it already. Districts may charge fees in line with what they charge their own students for materials, etc.Opportunity Schools Program: The Mayor, Governor, and County Executive will compile a list of candidates for the Commissionership, which the County Executive will select from. The Commissioner will choose a small number of schools (1-3 in year 1) that “failed to meet expectations.” The Commissioner will develop an RFP for school operators to take over operation of that school. The wording currently does not explicitly mention non-instrumentality charters as an “operator,” though we will be working with our partners to ensure that those are specifically included. From there, the Commissioner would enter into a 5-year agreement and the school would operate under MPS as a non-instrumentality charter school. The MPS Superintendent is also given parallel authority to deal with the “fails to meet expectations” schools, though she may choose the schools after the Commissioner.

IF YOU have any specific questions as the budget formation continues, please contact Sean Roberts directly at 414-763-1261.